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Form 200. Corporate Income Tax Declaration 2018

8.4.3.3 2018: Spanish film productions (PC)

Article 36.1 of the LIS establishes that taxpayers may claim the deduction for investments in cinematographic productions with respect to Spanish productions of feature-length films and audiovisual series of fiction, animation or documentaries, which allow the creation of a physical medium prior to their serial industrial production, provided that they are considered the producer of the work.

The reporting entity must record in code [00807] (page 17 of form 200) the amount corresponding to the expenses incurred in the production and exhibition of live performing arts and musical shows generated in the tax period and in code [00808] the amount of the deduction that is subject to application in this declaration.

Deduction percentages applicable in fiscal year 2018.

The producer of the work may apply the following deduction percentages:

  • 25 percent (20 percent until 01-31-2016) of the first million of the deduction base.

  • 20 percent (18 percent until 31-01-2016) on the excess of said amount.

Deduction base

The basis for the deduction will be the total cost of production, as well as the costs of obtaining copies and the advertising and promotion costs borne by the producer up to a limit of 40 percent of the cost of production for both.

At least 50 percent of the deduction base must correspond to expenses incurred in Spanish territory.

The deduction cannot be greater than 3 million euros.

The financial co-producer who participates in a Spanish feature film production will be entitled to this deduction based on their respective percentage of participation.

Requirements

To apply the deduction established in this section, the following requirements must be met:

  1. That the production obtains the corresponding certificate of nationality and the certificate that accredits the cultural character in relation to its content, its connection with the Spanish cultural reality or its contribution to the enrichment of the cultural diversity of the cinematographic works that are exhibited in Spain, issued by the Institute of Cinematography and Audiovisual Arts.

  2. That a new and perfect copy of the production be deposited in the Spanish Film Library or the film library officially recognized by the respective Autonomous Community, under the terms established in Order CUL /2834/2009.

The deduction provided for in this section will be generated in each tax period for the production cost incurred in the same, although it will be applied from the tax period in which the production of the work ends.

In the case of animation productions, the deduction provided for in this section will be applied from the tax period in which the certificate of nationality indicated in letter a) above is obtained.

The investment portion financed with subsidies will not give rise to deductions.

Application limit

The amount of this deduction, together with the rest of the aid received by the taxpayer, may not exceed 50 percent of the cost of production.

However, this limit will be raised to:

  • 60% in the case of cross-border productions financed by more than one Member State of the European Union and involving producers from more than one Member State.

  • 70 percent in the case of productions directed by a new director with a production budget of no more than 1 million euros.

Deadline to apply for the deduction

The production costs incurred in each tax period will qualify for this deduction, although it will be applied with effect from the tax period in which production of the work is concluded.

However, in the case of animation productions, the deduction provided for in this section will be applied from the tax period in which the aforementioned certificate of nationality is obtained.

Amounts not deducted in the tax period may be applied in the settlements of tax periods ending within the next fifteen years.